EUR/USD awaits US data
Yesterday saw German unemployment figures improve in tandem with the eurozone unemployment rate of 11.5%. Any positive sentiment gained from this has now been lost as the inflation rate continues to drop and Spanish, Italian and eurozone manufacturing purchasing managers’ index figures have all missed the mark.
The 300 plus pip fall in the EUR/USD rate over the course of July has been driven primarily by the US data releases, and the improving outlook. The dwindling levels of confidence are a reflection of an economic region struggling to maintain a recovery, hampered by numerous global issues out of their control.
Even though EUR/USD is oversold on the relative strength index, sentiment continues to weigh on it and a move above $1.34 looks unlikely until the US data-heavy afternoon session is out the way.